Ethereum Technical Analysis: How to Trade

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Ethereum is the second most relevant cryptocurrency in the crypto world, after Bitcoin.

It’s a crypto asset that has other utilities, beyond just accumulating value over time.

Currently, thanks to Ethereum, thousands of projects of all kinds such as Decentralized Finance or NFTs have emerged.

This makes the native token of the Ethereum network (ETH) necessary to trade in all these emerging projects, simultaneously increasing the demand and price of ETH.

To learn more about Ethereum, here is an analysis and forecast of its chart in depth. I will update it every 15 days, so you don’t miss anything. 😉

Chart of Ethereum (ETH)

This chart shows a clear long-term uptrend, but right now (07/02/2025), Ethereum is hovering around $2,700.

Price dropped throughout most of 2024, had a strong push-up, and then fell again at the start of 2025. As of now, ETH is still in a clear downtrend.

What do you think is going on?

 

ethereum trend analysis

Technical Analysis Ethereum

It’s important to read charts and their context well, such as detecting supports and resistances, checking the trend of the chart, etc.

What technical indicators does today’s Ethereum chart show?

1- Supports and Resistances

Supports are below the price and resistances are above.

Where are the levels located on this chart?

ethereum supports and resistance

As you can see, Ethereum broke past the $2,000 zone, then had a strong bullish run in early 2024, pushing up to the psychological level of $4,000. After that, we saw a sharp drop, followed by accumulation, and by the end of 2024, ETH was back at the top again.

Did you manage to take advantage of this move? 🚀

 

2- Where to Enter and Where to Exit

If you intended to manually exit the operation, you can forget that idea.

Placing your entry, exit, or even the stop loss correctly is important.

You should consider what kind of investor you are. If you want to buy Ethereum for the long term (holder), you would wait for support zones to accumulate positions. You wouldn’t mind much if the price fluctuated.

However, if you like to trade (swing trader), you need to be clear about where to place your entry, your stop loss, and your risk.

ethereum trading analysis

In this case, given the current price, we could consider buying in the $2,700 – $2,800 zone, as it has seen a strong rebound and is sitting at a key support level.

Your first target would be $4,000, and we should keep a close eye on whether price manages to break its all-time high of $4,870.

Looking at the weekly chart, there’s a chance price could dip back to the $2,000 zone, though that seems less likely at the moment.

What do you think? Would you take a position here?

 

3- Weekly Average

You may have noticed that in the charts of the medium-term strategy (weekly charts) there is always a moving average.

My advice is that you clearly define two colors in your moving average for when it rises or falls. When the average constantly changes color, it is indicating a lateral phase.

I have configured it in the following way:

  • The blue color indicates bullish moments.
  • The red color indicates bearish phases.

 

moving weekly average ethereum

The weekly moving average has been bearish for several weeks, and price is still dropping.

Right now, there’s increased price-to-value tension due to the sharp rebound we’re seeing. The key here is to wait for price to stabilize at one of the key levels before resuming the uptrend.

Does that make sense to you? What move would you make here?

 

4- Divergences

Divergence is the opposite of convergence.

If converging means “directing towards the same point,” diverging is “behaving in the opposite manner.”

Thus, in technical analysis, a divergence occurs when the price and an indicator have opposite behaviors at their extremes. That is, one rises and the other falls.

Let’s analyze the Ethereum chart. At first glance, what do you detect?

ethereum divergences macd

On the weekly chart, we previously saw a drop in one of our key indicators—the MACD.

Right now, the MACD is in negative territory and pointing downward, moving in sync with price action. This alignment suggests that bearish momentum is still in play.

5 – Price Structure

Technical analysis serves to predict what the price will do. We often use different techniques such as divergences with indicators, trend lines, patterns, etc.

But the most important thing is what the price is “drawing,” what you will know as price structure. No asset moves in a straight line constantly. Sooner or later, there is a lot of tension in one direction, and there is an imbalance between buyers and sellers that needs to be rebalanced.

This causes the price to create the famous swings or impulses and retracements, which are creating structures of highs and lows in one direction. Understanding how these movements are created will give you clarity when detecting the trend of the asset you are looking at.

What’s happening with Ethereum?

price structure ethereum

I’ve marked the latest price movements on the candlestick chart, and we can clearly see a bearish structure on the daily chart, with lower highs and lower lows forming since the $4,000 zone. You can see how each downward swing has played out perfectly, following a textbook downtrend from 2024 to today—there’s no doubt about this bearish trend from a technical standpoint.

What could happen next?

Right now, we’re seeing a strong sell-off, pushing price way lower, but this also means better buying opportunities for those looking to enter at a discount.

At this stage, it’s crucial not to get caught up in FOMO. Stick to your strategy and wait for price to reach key support levels before making a move.

Also, keep a close eye on the $4,000 level—if price breaks through, two major things happen:

  1. Key resistance is broken, signaling renewed bullish strength.
  2. A new higher high is formed, marking a potential trend reversal to the upside.

How would you play this setup? Are you waiting for support, or would you jump in now?

 

6 – Volatility

Volatility is usually a sign that the price is accelerating in a direction.

To understand the volatility Ethereum has, you’ll need to look at the candlesticks.

Remember, the interpretation of Japanese candles in trading is a matter of common sense.

ethereum volatility

 

On the chart, we’ve highlighted (in orange) the recent periods where Ethereum experienced high volatility.

We can see how high volatility aligns with sharp declines, with strong hands fully backing this downtrend. There’s no doubt about their intentions during this phase—they’ve been in complete control of the move.

Forecast with Ethereum

I’m no fortune teller, and I don’t pretend to be one, but in the short term, it’s pretty clear that Ethereum is likely to slow down in this zone—at least, that’s what the strength of this rebound suggests. You could even look for a breakout and pullback to the $2,700 zone, which is already starting to play out.

That said, Ethereum, despite being the second-largest crypto by market cap, has been the worst performer among the TOP 10 this year. It still has a long way to go before reclaiming its all-time high of $4,800. So, if the rest of the market keeps pushing higher, ETH could still have plenty of upside, making it an opportunity worth considering.

We need to watch closely to see if ETH stabilizes at key levels, forms a buy signal, or if indicators align with an entry. Patience is key—wait for the right setup instead of trying to front-run the move.

What’s your plan? Are you positioning yourself now, or waiting for more confirmation?

Trading with Ethereum

As you already know, trading with Ethereum is not easy. Therefore, it’s crucial to educate yourself first to become profitable. Remember to store Ethereum in the safest ETH wallet in the world, Material Ether.

And, of course, don’t forget to follow the Bitcoin chart with me. Don’t buy just because the price reaches support; always wait for confirmation of the stop. If you have doubts or questions, feel free to join our Telegram channel.

For more in-depth analysis, check out our trend analysis of Bitcoin.

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    Eva Robledo - Material Bitcoin

    Eva Robledo - Material Bitcoin

    Eva Robledo has specialized in both professional marketing and advanced SEO. She is currently working on various projects related to the world of trading, cryptocurrencies, and finance. With extensive experience in content creation for these areas, among others, she brings valuable expertise to her endeavors.

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